But if you were right, he would surely be following up even the slightest interest from other parties which doesn't seem to be the case.
Agreed but goes back to my point about him being stubborn and doing things his own way. He could well be interested in talking to potential new investors but not until he is ready (after he has asset stripped the club!).
I suppose the flip side of this view is that if he assets strips then looks to sell on that will surely devalue the club.
Maybe I should try and give up guessing what will be RD's next move as I am pretty sure he doesn't have a clue himself either!!!
Having thought a bit more about my earlier post I have come to this as a possible conclusion.
Asset stripping can only happen in a transfer window. If he had met with PV earlier, my other point may have kicked in - prospective buyers would veto any attempts at asset stripping, hence keeping PV on the end of a piece of string. RD must know that PV, as a supporter, would hang on longer than, say, a Josh Harris. I fear the worst!
Also, on your other point, it is unlikely that player values would be fully appreciated in a sale price for the club.
Sell the better players and the value of the club goes down too.
The accounts I think Im right in saying include players at the value they are bought for and that amount is reduced (amortised) over several years. So the value of the players, as shown in the accounts, has nothing to do with what the player might be worth in the transfer market.
So the value of a company based on accounting values does not reflect the transfer value of players as an asset.
When a player is sold the difference between the accounting value and the transfer value is a realised gain or loss, and it goes into the accounts as cash to either reduce losses or to buy another asset (Player). Bottom line is selling a player for a profit against book value increases the accounting value not reduce it.
It is not possible for RD to just trouser cash from the sale of a player, it goes into the books. RD only gets cash by selling his shares, having his debts repaid, making a profit to support a dividend or using cash from player proceeds to reduce the losses he funds.
You cannot "asset strip" just by selling assets (players) for cash, this simply changes the nature of the asset from a player value to cash. You asset strip by selling assets for more than their accounting value to yourself and wind up the stripped company, as it has no assets to produce anything.
The big ticket item in valuing CAFC and the negotiated value is the debt, not player values. The only thing the accounts tell a purchaser about the value of CAFC is how much cash it will burn to keep it going.
Can't really see this is relevant to anything very much. The repayment isn't triggered until promotion which is very unlikely indeed and in any event would make the money owed almost inconsequential. So there are charges on some assets - presumably The Valley - which may or may not prove to be a stumbling block to any takeover but that seems unlikely as it's money that only has to be paid if the club is awash with the stuff. My guess, for what it is worth, is that RD might make a knock-down offer, say 5p in the £ to lift the charges. 5% of something is better than 100% of nothing any day of the week.
Surely these agreements to pay the £7M aren't as open ended as "when we reach the premiership". If it isn't time limited, then I would have thought that the present owner would have to show intent to reach that goal. As it is he is employing senior staff who are not up to the job, players who - in the main - are not up to championship standard and a budget which is the third lowest in the league.
It would appear that he has no intention of paying those ex-directors.
But if you were right, he would surely be following up even the slightest interest from other parties which doesn't seem to be the case.
Agreed but goes back to my point about him being stubborn and doing things his own way. He could well be interested in talking to potential new investors but not until he is ready (after he has asset stripped the club!).
I suppose the flip side of this view is that if he assets strips then looks to sell on that will surely devalue the club.
Maybe I should try and give up guessing what will be RD's next move as I am pretty sure he doesn't have a clue himself either!!!
Having thought a bit more about my earlier post I have come to this as a possible conclusion.
Asset stripping can only happen in a transfer window. If he had met with PV earlier, my other point may have kicked in - prospective buyers would veto any attempts at asset stripping, hence keeping PV on the end of a piece of string. RD must know that PV, as a supporter, would hang on longer than, say, a Josh Harris. I fear the worst!
Also, on your other point, it is unlikely that player values would be fully appreciated in a sale price for the club.
Sell the better players and the value of the club goes down too.
The accounts I think Im right in saying include players at the value they are bought for and that amount is reduced (amortised) over several years. So the value of the players, as shown in the accounts, has nothing to do with what the player might be worth in the transfer market.
So the value of a company based on accounting values does not reflect the transfer value of players as an asset.
When a player is sold the difference between the accounting value and the transfer value is a realised gain or loss, and it goes into the accounts as cash to either reduce losses or to buy another asset (Player). Bottom line is selling a player for a profit against book value increases the accounting value not reduce it.
It is not possible for RD to just trouser cash from the sale of a player, it goes into the books. RD only gets cash by selling his shares, having his debts repaid, making a profit to support a dividend or using cash from player proceeds to reduce the losses he funds.
You cannot "asset strip" just by selling assets (players) for cash, this simply changes the nature of the asset from a player value to cash. You asset strip by selling assets for more than their accounting value to yourself and wind up the stripped company, as it has no assets to produce anything.
The big ticket item in valuing CAFC and the negotiated value is the debt, not player values. The only thing the accounts tell a purchaser about the value of CAFC is how much cash it will burn to keep it going.
So, is there any advantage to RD in selling, say, Lookman tomorrow, then immediately entering into negotiations to sell the club, rather than keeping him as an 'asset' of the club (he is wishfully selling on Monday ;-)) ?
I am a little confused. If the previous directors are owed money on the promise of payment apon promotion to the Premier League, yet the club (at present) have made it clear that promotion is not an aim or intention, how do they stand about getting their money back?
I am a little confused. If the previous directors are owed money on the promise of payment apon promotion to the Premier League, yet the club (at present) have made it clear that promotion is not an aim or intention, how do they stand about getting their money back?
Totally not possible to understand who gets what without being able to read the drafting of the loan agreements, the player contracts and in particular how these deal with any change of control.
If anyone has around £100m in cash to force the hand here, then we might as well not bother talking about it because it could be anywhere between £30 and £150m to take out the shares and the debt.
Inevitably of the club is in spine trouble, the debt piece can be negotiated but again depending upon the relative strength of the will to leave and the will to buy.
Comments
So the value of a company based on accounting values does not reflect the transfer value of players as an asset.
When a player is sold the difference between the accounting value and the transfer value is a realised gain or loss, and it goes into the accounts as cash to either reduce losses or to buy another asset (Player). Bottom line is selling a player for a profit against book value increases the accounting value not reduce it.
It is not possible for RD to just trouser cash from the sale of a player, it goes into the books. RD only gets cash by selling his shares, having his debts repaid, making a profit to support a dividend or using cash from player proceeds to reduce the losses he funds.
You cannot "asset strip" just by selling assets (players) for cash, this simply changes the nature of the asset from a player value to cash. You asset strip by selling assets for more than their accounting value to yourself and wind up the stripped company, as it has no assets to produce anything.
The big ticket item in valuing CAFC and the negotiated value is the debt, not player values. The only thing the accounts tell a purchaser about the value of CAFC is how much cash it will burn to keep it going.
The repayment isn't triggered until promotion which is very unlikely indeed and in any event would make the money owed almost inconsequential.
So there are charges on some assets - presumably The Valley - which may or may not prove to be a stumbling block to any takeover but that seems unlikely as it's money that only has to be paid if the club is awash with the stuff.
My guess, for what it is worth, is that RD might make a knock-down offer, say 5p in the £ to lift the charges.
5% of something is better than 100% of nothing any day of the week.
It would appear that he has no intention of paying those ex-directors.
If anyone has around £100m in cash to force the hand here, then we might as well not bother talking about it because it could be anywhere between £30 and £150m to take out the shares and the debt.
Inevitably of the club is in spine trouble, the debt piece can be negotiated but again depending upon the relative strength of the will to leave and the will to buy.